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EXHIBIT 10.16
COMMON STOCK PURCHASE AGREEMENT
between
OMNISKY CORPORATION
and
AMERICA ONLINE, INC.
Dated as of August 31, 2000
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COMMON STOCK PURCHASE AGREEMENT
This COMMON STOCK PURCHASE AGREEMENT (this "Agreement") is entered into
as of August 31, 2000, by and between OmniSky Corporation, a Delaware
corporation (the "Company"), and America Online, Inc., a Delaware corporation
(the "Purchaser").
RECITALS
WHEREAS, the Purchaser desires to purchase shares of the Company's
common stock ("Common Stock") in a private placement to close concurrently with,
but not before, the closing of the initial public offering of the Company's
common stock (the "IPO") pursuant to a Registration Statement on Form S-1 filed
with the Securities and Exchange Commission (the "Commission") (such
registration statement, as amended, shall be referred to herein as the
"Registration Statement"); and
WHEREAS, the Company desires to issue and sell the Shares (as defined
below) to the Purchaser on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual promises hereinafter set forth, the parties hereto agree as follows:
1. AGREEMENT TO SELL AND PURCHASE
1.1. AUTHORIZATION OF SHARES. On or prior to the Closing (as defined in
Section 2 below), the Company shall have authorized the sale and issuance to the
Purchaser of the Shares. Prior to the Closing, the Company will have adopted and
filed a Certificate of Incorporation (the "Certificate of Incorporation") with
the Secretary of State of the State of Delaware authorizing sufficient shares of
Common Stock to cover the sale and issuance of the Shares to be purchased
hereunder.
1.2. SALE AND PURCHASE OF COMMON STOCK. Subject to the terms and
conditions hereof, the Company hereby agrees to issue and sell to the Purchaser
and the Purchaser agrees to purchase from the Company, at the Closing, that
whole number of shares of Common Stock equal to the quotient determined by
dividing $5 million by the per share Price to Public (as defined below) and
rounding down to the nearest whole number. The shares of Common Stock to be
purchased hereunder are referred to as the "Shares". The per share purchase
price for the Shares purchased hereunder shall be the per share Price to Public.
The "Purchase Price" shall be equal to the amount obtained by multiplying the
Shares by the per share Price to Public.
For purposes of this Agreement, the term "Price to Public" shall mean
the Price to Public set forth on the cover page of the final Prospectus (as
defined below), less the underwriting discounts and commissions per share as set
forth on the cover page of the final Prospectus. For purposes of this Agreement,
the term "Prospectus" means the prospectus, as amended, on file with the
Commission at the time the Registration Statement becomes effective, including
the information deemed to be part of the Registration at the time of
effectiveness pursuant to Rule
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430A, if applicable, except that if the Prospectus filed by the Company pursuant
to Rule 424(b) differs from the prospectus on file at the time the Registration
Statement becomes effective, the term "Prospectus" shall refer to the Rule
424(b) Prospectus from and after the time it was filed with the Commission or
transmitted to the Commission for filing.
1.3. ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ COMPLIANCE. Notwithstanding anything else in this
Agreement, if the sale and issuance of the Shares is subject to the premerger
notification requirements of the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of
1976, as amended (the "HSR Act"), it shall be a condition to the Closing that
any waiting period under the HSR Act applicable to the purchase of the Shares
shall have expired or been terminated and any approvals required thereunder
shall have been obtained, and the parties shall cooperate in promptly filing
premerger reports and in taking all steps reasonably necessary to obtain early
termination of any applicable HSR Act waiting periods. If any such waiting
period shall not have expired or been subject to early termination on or before
the date ninety (90) days from the date of this Agreement, either party may
terminate this Agreement by giving written notice to the other.
2. CLOSING, DELIVERY AND PAYMENT
Subject to the terms of Section 5, the closing of the sale and purchase
of the Shares under this Agreement (the "Closing") shall take place concurrently
with, but not before, the closing of the IPO at the offices of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, Professional Corporation, ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇. The date of the Closing is referred to as the "Closing Date."
At the Closing, subject to the terms and conditions hereof, the Company will
deliver to the Purchaser a certificate representing the number of Shares to be
purchased at the Closing against payment in immediately available funds by or on
behalf of the Purchaser of the Purchase Price in cash, by wire transfer or by
such other means as shall be mutually agreeable to the Purchaser and the
Company.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents and
warrants to the Purchaser that the representations and warranties set forth in
the underwriting agreement entered into with the managing underwriters of the
IPO (the "Underwriting Agreement") will be true and correct in all respects and
are hereby incorporated by reference herein. Except as set forth in the Schedule
of Exceptions attached hereto as Annex 1, the Company hereby additionally
represents and warrants to the Purchaser as of the date hereof as follows:
3.1. ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. The Company has full corporate power and authority to
own and operate its properties and assets and to carry on its business as
presently conducted. The Company is duly qualified, authorized to do business
and in good standing as a foreign corporation in all jurisdictions in which the
nature of its activities and its properties (both owned and leased) makes such
qualification necessary, except for those jurisdictions, in the aggregate, in
which failure to do so would not have a material adverse effect on the Company
or its business.
3.2. AUTHORIZATION; BINDING OBLIGATIONS. All corporate action on the
part of the
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Company, its officers, directors and stockholders necessary for the
authorization, execution and delivery of this Agreement and the Certificate of
Incorporation, for the sale and issuance of the Shares pursuant hereto and for
the performance of the Company's obligations hereunder has been taken or will be
taken prior to the Closing. This Agreement, when executed and delivered, will be
a valid and binding obligation of the Company enforceable against the Company in
accordance with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws of general application
affecting enforcement of creditors' rights and (ii) general principles of equity
that restrict the availability of equitable remedies. The sale of the Shares is
not and will not be subject to any preemptive rights or rights of first refusal
that have not been properly waived or complied with. When issued in compliance
with the provisions of this Agreement and the Certificate of Incorporation, the
Shares will be validly issued, fully paid and nonassessable, and will be free of
any liens or encumbrances; provided, however, that the Shares may be subject to
restrictions on transfer under this Agreement and under state and/or federal
securities laws as set forth herein or as otherwise required by such laws at the
time a transfer is proposed.
3.3. COMPLIANCE WITH OTHER INSTRUMENTS. The execution, delivery and
performance of and compliance with this Agreement and the issuance and sale of
the Shares pursuant hereto will not (i) materially conflict with, or result in a
material breach or violation of, or constitute a material default under, or
result in the creation or imposition of, any material lien, (ii) violate,
conflict with or result in the breach of any material terms of, or result in the
material modification of, any material contract or otherwise give any other
contracting party the right to terminate a material contract, or constitute (or
with notice or lapse of time constitute) a material default under any material
contract to which the Company is a party or by or to which it or any of its
assets or properties may be bound or subject or (iii) result in any violation,
or be in conflict with or constitute a default under any term, of its
Certificate of Incorporation or bylaws or any law, statute, order or regulation
applicable to the Company.
3.4. LITIGATION. There is no action, suit, proceeding nor, to the
Company's knowledge, any investigation pending or currently threatened against
the Company, that questions the validity of this Agreement or the right of the
Company to enter into such agreement, or which might result, either individually
or in the aggregate, in any material adverse change in the assets, affairs or
condition (financial or otherwise) of the Company.
3.5. GOVERNMENTAL CONSENT. No consent, approval or authorization of, or
designation, declaration or filing with, any governmental authority on the part
of the Company is required in connection with the valid execution, delivery, and
performance of this Agreement or the offer, sale or issuance of the Shares, or
the consummation of any other transaction contemplated by this Agreement, except
certain filings as may be required under the Securities Act of 1933, as amended
(the "Securities Act") and state securities laws and regulations, which filings
will be made timely in accordance with the applicable law or regulation, or the
HSR Act, if applicable.
3.6. INTELLECTUAL PROPERTY RIGHTS. To the knowledge of the Company, the
Company or its subsidiaries own and possess or are licensed under all patents,
patent applications, licenses, trademarks, trade secrets, trade names, brand
names, inventions and copyrights or other
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proprietary rights ("Intellectual Property") employed in the operation of their
respective businesses as currently conducted, and, to the knowledge of the
Company, with no infringement of or conflict with the rights or others
respecting any of the same. Neither the Company nor any subsidiary has received
any communications alleging that the Company or any subsidiary has violated any
of the Intellectual Property of any other person or entity. Reasonable security
measures have been taken by the Company and its subsidiaries to protect the
secrecy, confidentiality and value of the Company's and its subsidiaries' trade
secrets, including their respective know-how, technology, concepts and other
technical data for the development, processing, manufacture and sale of its
products. Each employee of and consultant to the Company or its subsidiaries has
executed an invention assignment and confidentiality agreement with the Company
or its subsidiaries.
4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The Purchaser hereby
represents and warrants to the Company as follows:
4.1. REQUISITE CORPORATE POWER AND AUTHORITY. The Purchaser has all
necessary corporate power and authority under all applicable provisions of law
to execute and deliver this Agreement and to carry out the provisions of this
Agreement. All action on the Purchaser's part required for the lawful execution
and delivery of this Agreement has been or will be effectively taken prior to
the Closing. This Agreement, when executed and delivered, will be a valid and
binding obligation of the Purchaser, enforceable against the Purchaser in
accordance with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws of general application
affecting enforcement of creditors' rights and (ii) general principles of equity
that restrict the availability of equitable remedies.
4.2. CONSENTS. All consents, approvals, orders, authorizations,
registrations, qualifications, designations, declarations or filings with any
governmental or banking authority on the part of the Purchaser required in
connection with the consummation of the transactions contemplated in this
Agreement have been or shall have been obtained prior to and be effective as of
the Closing.
4.3. INVESTMENT REPRESENTATIONS. The Purchaser understands that the
Shares have not been registered under the Securities Act. The Purchaser also
understands that the Shares are being offered and sold pursuant to an exemption
from registration contained in the Securities Act based in part upon the
Purchaser's representations contained in the Agreement. The Purchaser hereby
represents and warrants as follows:
(a) The Purchaser is an Accredited Investor. The Purchaser
represents that the Purchaser is an "accredited investor" within the
meaning of Rule 501(a) of Regulation D under the Securities Act.
(b) The Purchaser Bears Economic Risk. The Purchaser must bear
the economic risk of this investment indefinitely unless the Shares are
registered pursuant to the Securities Act, or an exemption from
registration is available. The Purchaser understands that there is no
assurance that any exemption from registration under the Securities Act
will be available and that, even if available, such exemption may not
allow
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the Purchaser to transfer all or any portion of the Shares under the
circumstances, in the amounts or at the times the Purchaser might
propose.
(c) Acquisition For Own Account. The Purchaser is acquiring the
Shares for the Purchaser's own account for investment only, and not with
a view towards their distribution within the meaning of the Securities
Act.
(d) The Purchaser Can Protect Its Interest. The Purchaser
represents that by reason of its, or its management's, business or
financial experience, the Purchaser has the capacity to protect its own
interests in connection with the transactions contemplated in this
Agreement. The Purchaser is not a corporation, trust or partnership
specifically formed for the purpose of consummating these transactions.
(e) Company Information. The Purchaser has had an opportunity to
discuss the Company's business, management and financial affairs with
directors, officers and management of the Company and has had the
opportunity to review the Company's operations and facilities. The
Purchaser has also had the opportunity to ask questions of and receive
answers from, the Company and its management regarding the terms and
conditions of this investment.
4.4. LEGENDS. Each certificate representing the Shares will be endorsed
with the following legends:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND
ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED UNDER THE
ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE
DISTRIBUTED EXCEPT (I) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SHARES UNDER THE ACT, (II) IN COMPLIANCE WITH RULE 144
OR (III) PURSUANT TO AN OPINION OF COUNSEL TO THE COMPANY THAT SUCH
REGISTRATION OR COMPLIANCE IS NOT REQUIRED AS TO SUCH SALE, OFFER OR
DISTRIBUTION."
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO, AND MAY BE
TRANSFERRED ONLY IN ACCORDANCE WITH, THE TERMS OF CERTAIN AGREEMENTS
AMONG THE COMPANY AND THE STOCKHOLDER, WHICH INCLUDE, WITHOUT
LIMITATION, 180 DAY MARKET STANDOFF RESTRICTIONS, COPIES OF WHICH ARE ON
FILE WITH THE SECRETARY OF THE COMPANY."
The Company need not register a transfer of any Shares, and may also instruct
its transfer agent not to register the transfer of the Shares, unless the
conditions specified in the foregoing legends are satisfied.
4.5. REMOVAL OF LEGEND AND TRANSFER RESTRICTIONS. Any legend endorsed on
a
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certificate pursuant to Section 4.4 and the stop transfer instructions with
respect to such Shares shall be removed and the Company shall issue a
certificate without such legend to the holder thereof if such legend may be
properly removed under the terms of Rule 144 promulgated under the Securities
Act or if such holder provides the Company with an opinion of counsel for such
holder, reasonably satisfactory to legal counsel for the Company, to the effect
that a sale, transfer or assignment of such Shares may be made without
registration.
5. CONDITIONS TO CLOSING
5.1. CONDITIONS TO THE PURCHASER'S OBLIGATIONS AT THE CLOSING. The
Purchaser's obligation to purchase the Shares identified in Section 1.2 of the
Agreement at the Closing are subject to the satisfaction, at or prior to the
Closing, of the following conditions:
(a) Concurrent Closing of IPO. The Closing shall occur
concurrently with, and not before, the closing of the IPO.
(b) Representations And Warranties True; Performance Of
Obligations. The representations and warranties made by the Company in
Section 3 and the representations and warranties which are incorporated
by reference from the Underwriting Agreement shall be true and correct
as of the Closing, and the Company shall have performed and complied
with all obligations and conditions herein required to be performed or
complied with by it on or prior to the Closing and shall have delivered
an officer's certificate as to the matters set forth in this Section
5.1(b).
(c) Legal Investment. At the time of the Closing, the sale and
issuance of the Shares shall be legally permitted by all laws and
regulations to which the Purchaser and the Company are subject.
(d) Consents, Permits, And Waivers. The Company shall have
obtained any and all authorizations, approvals, consents, permits and
waivers necessary or appropriate for consummation of the transactions
contemplated by this Agreement (except for such as may be properly
obtained subsequent to the Closing, and such items shall be effective on
and as of the Closing).
(e) Legal Opinion. The Company shall have delivered an opinion
of counsel to the Purchaser in substantially the form attached hereto as
Exhibit A.
(f) Transfer Agent Instructions. The Company shall have delivered
to the Purchaser a copy of a letter to the Company's transfer agent,
dated the Closing Date, and instructing the transfer agent to issue the
Shares.
(g) Strategic Marketing and Content Agreement. The Company shall
have executed and delivered to the Purchaser, substantially in the form
attached hereto as Exhibit B, the Strategic Marketing and Content
Agreement, and such agreement shall be in full force and effect.
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5.2. CONDITIONS TO OBLIGATIONS OF THE COMPANY. The Company's obligation
to issue and sell the Shares at the Closing is subject to the satisfaction, on
or prior to the Closing of the following conditions:
(a) Concurrent Closing of IPO. The closing of the IPO shall
occur concurrently with, but not before, the Closing.
(b) Services Agreement. The Purchaser shall have executed and
delivered to the Company, substantially in the form attached hereto as
Exhibit B, the Services Agreement, and such agreement shall be in full
force and effect.
(c) Representations and Warranties True. The representations and
warranties made by the Purchaser in Section 4 hereof shall be true and
correct in all material respects at the date of the Closing, with the
same force and effect as if they had been made on and as of said date.
(d) Performance Of Obligations. The Purchaser shall have
performed and complied with all agreements and conditions herein
required to be performed or complied with by the Purchaser on or before
the Closing.
(e) Payment of Purchase Price. The Purchaser shall deliver to
the Company the Purchase Price in immediately available funds as set
forth in Section 2.1.
6. REGISTRATION RIGHTS. The Company hereby grants Purchaser the same
registration and related rights as are set forth in Sections 5, 6, 7, 8, 9, 12
and 15 of the Second Amended and Restated Investors' Rights Agreement dated as
of April 24, 2000 (the "Investors' Rights Agreement") by and among the Company
and various other stockholders; provided that, (x) in the event a limitation of
the number of shares to be included in a registration pursuant to Sections 5 or
6 of the Investors' Rights Agreement is made, then the Purchaser shall be
subordinate in all respects to holders of Registrable Securities (as defined in
the Investors' Rights Agreement) and pari passu with all other holders of
registration rights and (y) the only limitation on the Purchaser relating to the
registration rights set forth in Section 9 of the Investors' Rights Agreement
shall be that the Holder requests in writing such number of Shares, the
reasonably anticipated aggregate offering price to the public of which exceeds
$1,000,000, be included on a registration statement on Form S-2 or S-3. The
Purchaser's rights under this Section 5, 6, 7, 8, 9, 12 and 15 shall be as if
the Purchaser were a "Holder" as defined in the Investors' Rights Agreement. The
registration rights granted pursuant to this Section 6 shall terminate as to the
Purchaser on the earlier of (i) August 31, 2004 and (ii) such time as the
Purchaser is able to sell all Shares, in one three-month period, pursuant to
Rule 144 promulgated under the Securities Act.
7. RULE 144 REPORTING. With a view to making available to the Purchaser the
benefits of certain rules and regulations of the Commission which may permit the
sale of the Shares to the public without registration, the Company agrees at all
times after the effective date of the Registration Statement to:
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(a) make and keep public information available, as those terms
are understood and defined in Rule 144 promulgated under the Act.
(b) file with the Commission in a timely manner all reports and
other documents required of the Company under the Securities Act and the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
(c) so long as the Purchaser owns any Shares, to furnish to the
Purchaser within a reasonable time upon a written request by the
Purchaser, a written statement by the Company as to its compliance with
the reporting requirements of said Rule 144 (at any time after ninety
(90) days after the effective date of the first registration statement
filed by the Company for an offering of its securities to the general
public) and of the Exchange Act (at any time after it has become subject
to such reporting requirements), a copy of the most recent annual or
quarterly report of the Company, and such other reports and documents so
filed by the Company as the Purchaser may reasonably request in
complying with any rule or regulation of the Commission allowing the
Purchaser to sell any such securities without registration.
8. COVENANTS
8.1. The Purchaser in connection with the first registration of the
Company's securities, upon request of the Company or the underwriters managing
such first registration of the Company's securities, agrees not to sell, make
any short sale of, loan, grant any option for the purchase of, or otherwise
dispose of any Shares or any shares of Common Stock of the Company or any
securities convertible into or exercisable or exchangeable for Shares or Common
Stock of the Company (whether such shares or any such securities are now owned
by the Purchaser or are hereafter acquired) (other than those included in the
registration) without the prior written consent of the Company or such
underwriters, as the case may be, for 180 days from the effective date of such
registration; provided, however, that all executive officers, directors and 2%
or greater shareholders of the Company must enter into similar lock-up
agreements as well. The Purchaser agrees that the Company may instruct its
transfer agent to place stop transfer notations in its records to enforce the
provisions of this Section 8.1. Notwithstanding the foregoing, the Purchaser may
freely transfer such securities to any affiliate (as that term is defined in
Rule 405 promulgated by the Commission under the Securities Act) of the
Purchaser, provided that written notice thereof is promptly given to the Company
and that the transferee agrees to be bound by the provisions of this Section
8.1.
9. MISCELLANEOUS.
9.1. GOVERNING LAW. This Agreement shall be governed in all respects by
the laws of the State of California, without regard to the principles of the
conflict of laws thereof.
9.2. SURVIVAL. The representations and warranties incorporated herein by
reference to the Underwriting Agreement shall survive for the period set forth
in the Underwriting
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Agreement. Except as set forth in the immediately preceding sentence or
elsewhere in this Agreement, the representations, warranties, covenants and
agreements made herein shall survive until the first anniversary of the closing
of the transactions contemplated hereby. All statements as to factual matters
contained in any certificate or other instrument delivered by or on behalf of
the Company pursuant hereto in connection with the transactions contemplated
hereby shall be deemed to be representations and warranties by the Company
hereunder solely as of the date of such certificate or instrument, except as
expressly provided otherwise in such certificate or instrument.
9.3. SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto and shall inure to the benefit of and be enforceable by each
person who shall be a holder of the Shares from time to time; provided, however,
that prior to the receipt by the Company of adequate written notice of the
transfer of any Shares specifying the full name and address of the transferee,
the Company may deem and treat the person listed as the holder of such Shares in
its records as the absolute owner and holder of such Shares for all purposes,
including the payment of any dividends or any redemption price.
9.4. SEPARABILITY. In case any provision of this Agreement shall be
invalid, illegal or unenforceable, such provision shall, to the extent
practicable, be modified so as to make it valid, legal and enforceable and to
maintain as nearly as practicable the intent of the parties, and the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
9.5. AMENDMENT AND WAIVER.
(a) This Agreement may be amended or modified only upon the written
consent of the parties hereto.
(b) The obligations of the Company and the rights of the holder of the
Shares under this Agreement may be waived only with the written consent of
the parties hereto.
(c) Except to the extent provided in this Section 9.5, neither this
Agreement nor any provision hereof may be changed, waived, discharged or
terminated, except by a statement in writing signed by the party against
which enforcement of the change, waiver, discharge or termination is sought.
(d) Any amendment or waiver effected in accordance with this Section 9.5
shall be binding upon any future holder of some or all of the Shares.
9.6. NOTICES. All notices and other communications required or permitted
hereunder shall be in writing and shall be deemed effectively given and received
(a) upon personal delivery, (b) on the fifth day following mailing sent by
registered or certified mail, return receipt requested, postage prepaid, (c)
upon confirmed delivery by means of a nationally recognized overnight courier
service or (d) upon confirmed transmission of facsimile addressed: (i) if to the
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Purchaser, at the Purchaser's address as set forth on the Company's records, or
at such other address as the Purchaser shall have furnished to the Company in
writing or (ii) if to the Company, at its address as set forth at the end of
this Agreement, or at such other address as the Company shall have furnished to
the Purchaser in writing.
9.7. EXPENSES. The Company shall pay all costs and expenses that it
incurs with respect to the negotiation, execution, delivery and performance of
this Agreement, and the Purchaser shall pay all costs and expenses that it
incurs with respect to the negotiation, execution, delivery and performance of
this Agreement.
9.8. ATTORNEYS' FEES. If legal action is brought to enforce or interpret
this Agreement, the prevailing party shall be entitled to recover its reasonable
attorneys' fees and legal costs in connection therewith.
9.9. TITLES AND SUBTITLES. The titles of the paragraphs and
subparagraphs of the Agreement are for convenience of reference only and are not
to be considered in construing this Agreement.
9.10. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one instrument.
9.11. BROKER'S FEES. Each party hereto represents and warrants that no
agent, broker, investment banker, person or firm acting on behalf of or under
the authority of such party hereto is or will be entitled to any broker's or
finder's fee or any other commission directly or indirectly in connection with
the transactions contemplated herein. Each party hereto further agrees to
indemnify each other party for any claims, losses or expenses incurred by such
other party as a result of the representation in this Section 9.11 being untrue.
9.12. TERMINATION. If the Registration Statement for the IPO has not
become effective by December 31, 2000, the Purchaser in its discretion may elect
to terminate this Agreement by providing written notice to the Company at any
time thereafter.
9.13. SUBSEQUENT CONSENTS, PERMITS AND WAIVERS. The Company shall obtain
promptly after the Closing all authorizations, approvals, consents, permits and
waivers that are necessary or applicable for consummation of the transactions
contemplated by this Agreement and that were not obtained prior to the Closing
because they may be properly obtained subsequent to the Closing.
9.14. MOST FAVORED NATION. Except for the maximum number of shares being
purchased, the Company agrees that the terms (including without limitation the
terms of Sections 1, 3 and 6) of this Agreement are and will be no less
favorable to the Purchaser than the terms given to other investors (including
investors that may enter into such agreements after the date hereof, if any)
that are purchasing shares of the Company's capital stock in private placements
that are closing concurrently with the closing of the IPO. Except as disclosed
in Amendment No. 4 to the Company's registration statement relating to its
initial public offering, since, June 1,
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2000, the Company has not entered into any agreement to sell or otherwise
dispose of any shares of its capital stock other than this Agreement.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date set forth in the first paragraph hereof.
COMPANY:
OmniSky Corporation
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Title Senior Vice President, Business Development
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PURCHASER:
America Online, Inc.
▇▇▇▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title President, Business Affairs
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Annex 1
OMNISKY CORPORATION
SCHEDULE OF EXCEPTIONS
Pursuant to Section 3 of the Common Stock Purchase Agreement (the
"Agreement") dated as of August 31, 2000, by and between the Company and the
Purchaser, the Company hereby delivers this Schedule of Exceptions to the
representations and warranties of the Company given in the Agreement. Each
section number in this Schedule of Exceptions corresponds to the section numbers
in the Agreement; however, any information disclosed herein under any section
number shall be deemed to be disclosed and incorporated in any other section
number of the Agreement where such disclosure would be appropriate. Any
capitalized terms not otherwise defined herein shall have the meaning ascribed
to them in the Agreement.
3.1 Organization, Good Standing and Qualification
No Exceptions.
3.2 Authorization; Binding Obligations
No Exceptions.
3.3 Compliance with Other Instruments
No Exceptions.
3.4 Litigation
On July 6, 2000, a complaint was filed in the United States District
Court for the Northern District of California captioned "▇▇▇▇▇ Butterfly Hill v.
AT&T Corporation, a New York corporation; AT&T Wireless Services, Inc., a
Delaware corporation; OmniSky Corporation, a Delaware corporation; TWBA
Chiat/Day, a Delaware corporation; and Does I-XX, inclusive." The complaint
alleges, among other things, false endorsement and false designation of origin;
false and misleading advertising and misappropriation of likeness and image. We
have not yet been served with the complaint. We intend vigorously to defend
ourselves and believe that the claims alleged are without merit. We do not
believe that the resolution of this matter will have a material effect on our
financial condition or results of operations.
Except as described in the previous paragraph, we are not currently
subject to any material legal proceedings. We may from time to time, however,
become a party to various legal proceedings arising in the ordinary course of
our business. We also may be indirectly affected, as we discussed above under
the subsection entitled "Government regulation" by administrative or court
proceedings or actions in which we are not involved but which have general
applicability to the Internet or wireless industries.
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3.5 Governmental Consent
No Exceptions.
3.6 Intellectual Property Rights
No Exceptions.
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EXHIBIT A
[FORM OF LEGAL OPINION]
[Closing Date]
To the Purchaser of Common Stock of
OmniSky Corporation pursuant to the Common
Stock Purchase Agreement dated as of the date hereof
Ladies and Gentlemen:
Reference is made to the Common Stock Purchase Agreement dated as of
August 31, 2000 (the "Purchase Agreement") by and among OmniSky Corporation, a
Delaware corporation (the "Company"), and America Online, Inc. (the
"Purchaser"), which provides for the issuance and sale by the Company to the
Purchaser of an aggregate of up to ____________ shares of Common Stock (the
"Shares") at a purchase price of $____ per share for an aggregate purchase price
of up to approximately $_________. This opinion is rendered to you pursuant to
Section 5.1(e) of the Purchase Agreement and all terms used herein have the
meanings defined for them in the Purchase Agreement unless otherwise defined
herein.
We have acted as counsel for the Company in connection with the
negotiation, execution and delivery of the Purchase Agreement and the issuance
of the Shares to the Purchaser as contemplated by the Purchase Agreement. As
such counsel, we have made such legal and factual examinations and inquiries as
we have deemed advisable or necessary for the purpose of rendering this opinion,
and we have examined originals or copies of the following:
(a) The Certificate of Incorporation of the Company (the
"Certificate");
(b) The Bylaws of the Company;
(c) The resolutions adopted by the Board of Directors of the Company
and the stockholders of the Company with respect to the
transactions contemplated by the Purchase Agreement;
(d) The certificates representing the shares of the Company's Common
Stock issued to the Purchaser on the date hereof;
(e) Executed counterparts of the Purchase Agreement;
(f) The officer's certificate dated the date hereof delivered to
you;
(g) The certified or official bank checks or evidence of wire
transfers payable to the Company delivered by the Purchaser on
the date hereof as consideration for the sale of the Shares; and
(h) The certificates of certain state authorities and filing
officers, copies of which are being delivered to you on the date
hereof.
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As used in this opinion, the expressions "to our knowledge," "known to
us," and "of which we are aware" with reference to matters of fact means that,
after an examination of documents made available to us by the Company and after
inquiries of officers of the Company, we find no reason to believe that the
opinions expressed herein are factually incorrect. Further, the expressions "to
our knowledge," "known to us," "of which we are aware" or similar language with
reference to matters of fact refers to the current actual knowledge of the
attorneys of this firm who have worked on matters for the Company solely in
connection with the Purchase Agreement. We have not undertaken any independent
investigation to determine the existence or absence of any fact, and no
inference as to our knowledge of the existence or absence of any fact should be
drawn from our representation of the Company or the rendering of the opinions
set forth below.
For purposes of this opinion, we are assuming that each party (other
than the Company) to the Purchase Agreement has all requisite power and
authority, and has taken any and all necessary corporate or partnership action,
to execute and deliver the Purchase Agreement to which it is a party and to
effect any and all transactions related or contemplated thereby, and that each
of you duly and validly executed and delivered the Purchase Agreement. We are
also assuming that the representations and warranties made by the Purchaser and
the Company under the Purchase Agreement are true and correct, and that the
Purchaser has purchased the Shares for value, in good faith and without notice
of adverse claims within the meaning of the Delaware Uniform Commercial Code.
The opinions, hereinafter expressed are subject to the following
additional exceptions, qualifications, limitations and assumptions:
We express no opinion as to (i) the effect of applicable bankruptcy,
insolvency, reorganization, liquidation, conservatorship, readjustment of debt,
moratorium or other similar laws affecting the rights of creditors or (ii) the
provisions of the Purchase Agreement relating to indemnity or contribution.
We express no opinion as to the effect of rules of law governing
specific performance, injunctive relief or other equitable remedies (regardless
of whether any such remedy is considered in a proceeding at law or in equity) or
as to the effects of public policy on the enforceability of any provision of any
agreement.
We express no opinion as to compliance with applicable anti-fraud
provisions of federal or state securities laws.
We have assumed the genuineness of all signatures on original documents,
the authenticity of all documents submitted to us as originals, the conformity
to original documents of all copies submitted to us as copies thereof, the legal
capacity of natural persons, and the due execution and delivery of all documents
(except as to due execution and delivery by the Company) where due execution and
delivery are a prerequisite to the effectiveness thereof.
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Our opinion set forth in paragraph 1 below is based solely on the
certificate referenced above as to the legal existence and corporate and tax
good standing of the Company in the state of Delaware.
This opinion is subject to the effect of statutes, principles of equity
and court decisions providing (i) that certain covenants and provisions of
agreements are unenforceable where enforcement of such covenants or provisions
under the circumstances would violate the enforcing party's implied covenant of
good faith and fair dealing and (ii) that a court may refuse to enforce, or may
limit the application of, a contract or any clause thereof that the court finds
to be unconscionable or contrary to public policy.
We have not reviewed, and express no opinion on, (i) financial covenants
or similar provisions requiring financial calculations or determinations to
ascertain whether there is any such conflict, (ii) provisions relating to the
occurrence of a "material adverse event" or words of similar import or (iii)
parol evidence bearing on interpretation or construction.
The opinions expressed herein are limited in all respects to existing
laws, rules and regulations of the State of California, the General Corporation
Law of the State of Delaware, as amended (the "DGCL") and applicable United
States federal laws, rules and regulations. Furthermore, we have made no inquiry
into, and express no opinion with respect to, any federal or state statute, rule
or regulation relating to any tax, antitrust, land use, safety, environmental,
hazardous material, patent, copyright, trademark or trade name matter, as to the
statutes, regulations, treaties or common laws of any other nation, state or
jurisdiction, or the effect on the transactions contemplated in the Purchase
Agreement of noncompliance under any such statutes, regulations, treaties or
common laws. We further disclaim any opinion as to any statute, rule,
regulation, ordinance, order or other promulgation of any regional or local
governmental body or as to any related judicial or administrative opinion.
Our opinions relate solely to the express provisions of the Purchase
Agreement and the exhibits referred to therein and attached thereto and we
express no opinion as to any other oral or written agreements or understandings
between the Company or the Purchaser.
Provisions of the Purchase Agreement requiring that waivers must be in
writing may not be binding or enforceable if a non-executory oral agreement has
been created modifying any such provision or an implied agreement by trade
practice or course of conduct has given rise to a waiver.
Based upon and subject to the foregoing, and subject in all respects to
the disclosure on the Schedule of Exceptions attached to the Purchase Agreement,
we are of the opinion that:
1. The Company is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware. The Company has the requisite
corporate power and authority to own the properties and assets owned by it and
to carry on its business as presently conducted.
2. The Company has all requisite legal and corporate power and authority to
execute and
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deliver the Purchase Agreement, to sell and issue the shares of Common Stock to
the Purchaser as contemplated by the Purchase Agreement and to carry out and
perform its obligations under the terms of the Purchase Agreement.
3. The authorized capital stock of the Company consists of 200,000,000 shares of
Common Stock, ____________ of which are issued and outstanding, and 10,000,000
shares of Preferred Stock, none of which is outstanding. All issued and
outstanding shares have been duly authorized, validly issued, fully paid, and
nonassessable and have been issued in compliance with the registration and
qualifications requirements of all applicable securities laws. Upon the
issuance, sale, and delivery for the consideration stated in the Purchase
Agreement, the shares of Common Stock being issued and sold to the Purchaser on
the date hereof shall be duly authorized, validly issued, fully paid, and
nonassessable, shall have been issued in compliance with the registration or
qualification requirements of all applicable securities laws (but excluding
jurisdictions outside the United States); provided, however, that the shares of
Common Stock may be subject to restrictions on transfer under state and/or
federal securities laws. To our knowledge, except for rights described in the
Purchase Agreement (including the Schedule of Exceptions) or in the Prospectus
or the Certificate, there are no other options, warrants, conversion privileges
or other rights presently outstanding to purchase or otherwise acquire any
authorized but unissued shares of capital stock or other securities of the
Company, or any other agreements to issue any such securities or rights.
4. All corporate action on the part of the Company, its directors and
stockholders necessary for the authorization, execution, delivery and
performance of the Purchase Agreement by the Company, and the authorization,
sale, issuance and delivery of the Common Stock to the Purchaser pursuant to the
Purchase Agreement and the Certificate, and the performance of the Company's
obligations under the Purchase Agreement has been taken. The Purchase Agreement,
when executed and delivered by the parties thereto, shall constitute a valid and
binding obligation of the Company, enforceable against the Company in accordance
with its terms.
5. The execution, delivery and performance of the terms of the Purchase
Agreement and the issuance of the Common Stock to the Purchaser pursuant to the
Purchase Agreement do not violate (i) any provision of the Company's Certificate
or Bylaws, or (ii) to our knowledge, any law, statute, rule or regulation of the
United States or the State of California.
6. Subject to the accuracy of the Purchaser's representations in Section 4 of
the Purchase Agreement, we are of the opinion that the offer, sale and issuance
of the Common Stock to the Purchaser in conformity with the terms of the
Purchase Agreement and the Certificate constitute transactions exempt from the
registration and qualification requirements of Section 5 of the Securities Act
of 1933, as amended, the laws of the State of California, and the DGCL.
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This opinion is furnished to the Purchaser solely for your benefit in
connection with the purchase of the Shares and is not to be made available to or
relied upon by any other person, firm or entity for any purpose without our
express prior written consent.
Very truly yours,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
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